Miners results weigh on Europe stocks
European shares closed yesterday's session lower, weighed down by miners and oil stocks as crude dropped below $59 a barrel, while a lacklustre batch of corporate earnings offset a boost from takeover activity.
Schneider Electric tumbled after saying it planned a capital increase to help fund the $6.1 billion acquisition of American Power Conversion, while Dutch bank ABN AMRO slipped after its earnings disappointed.
The little bit of disappointment we saw today and on Friday is not really a problem for the market, because this earnings season is good," said Philippe Gijsels, senior equity strategist at Fortis Bank.
"As long as the soft landing scenario holds, we're cautiously positive, and we think a three to five per cent correction will present a buying opportunity."
The FTSEurofirst 300 index of top European shares closed down 0.3 per cent at 1,444.99 points, recouping some of its earlier losses after the sharp drop in crude prices.
Britain's FTSE fell 0.6 per cent, while Germany's DAX dropped 0.1 per cent.
Resource stocks weighed, with BHP Billiton down 2.1 per cent and Rio Tinto 1.4 per cent lower, while steelmaker Salzgitter fell 2.5 per cent.
Oil stocks languished as crude oil sank, with BP down 1.7 per cent. Norwegian oil and gas group Statoil ASA dropped 2.2 per cent after a forecast-beating rise in operating profit was accompanied by higher costs.
UK insurer Standard Life added 1.6 per cent after the Sunday Express newspaper said in an unsourced report that France's AXA was considering a seven billion pound bid. AXA shares dipped 1.2 per cent.
Hanson added 2.3 per cent after Australia's Rinker rejected a bid from Cemex, raising speculation the Mexican company may instead set its sights on the British firm.
Among companies reporting earnings, ABN AMRO clawed back most of its earlier losses to end down just 0.2 per cent after the market was disappointed with its higher-than-expected credit costs.
Dutch mail company TNT NV staged a late rally to end up 0.1 per cent. It tumbled sharply earlier in the session after its operating profit proved better than expected but analysts said the results of the mail division had disappointed in some respects.
Elsewhere, Cadbury Schweppes Plc fell 1.5 per cent after the world's largest confectionery group dropped its growth target for operating margin but said it would maintain its current revenue-growth target for 2007 and beyond.
Spanish construction and services group Ferrovial added 1.6 per cent after posting an 86 per cent rise in nine-month core profit (EBITDA), powered higher by its takeover of British airports operator BAA.